HK Partner David Wilkes Applauds Supreme Court’s Victory for Homeowners

May 29, 2023 | Articles & Press Releases

Herman Katz Partner David Wilkes Applauds Supreme Court's Victory for Homeowners

In a groundbreaking ruling, the United States Supreme Court delivered a unanimous decision in Tyler v. Hennepin County, declaring property tax surplus retention laws as unconstitutional. This landmark verdict has been hailed as a significant triumph for homeowners and property advocates across the nation. David Wilkes, a partner at Herman Katz, has played a pivotal role in this case, lending his expertise to support the plaintiff’s position.

In conjunction with his involvement in the case, David Wilkes, a renowned legal expert, has recently penned an op-ed on Bloomberg Law, providing insightful analysis and commentary on the implications of the Tyler v. Hennepin County ruling. The op-ed, titled “Supreme Court Forfeiture Ruling Spells Victory for Homeowners,” highlights the significance of the court’s decision and its impact on property rights.

The court’s opinion, delivered by Chief Justice John Roberts and with a concurring opinion by Justices Neil Gorsuch and Ketanji Brown Jackson, brings together an unlikely alliance of economically disadvantaged homeowners and libertarian-oriented property rights advocates. This ruling necessitates the reevaluation of foreclosure statutes in numerous states, prompting a reexamination of the laws governing property rights.

At the heart of this case is Geraldine Tyler, the plaintiff, who challenged Minnesota’s state law that allowed Hennepin County to retain a $25,000 surplus following the auction sale of her home to settle unpaid taxes amounting to approximately $15,000. David Wilkes, as counsel of record, provided a brief in support of Tyler’s argument, highlighting the broader implications of tax foreclosure statutes prevalent in various states.

Wilkes explained, “Such laws favor the tax collector and impose a draconian downside to investing in one’s home. Wealth creation in the form of home equity can be entirely wiped out based on a minor tax delinquency that is disproportionate to the value confiscated. Beyond statutes, taking an amount that exceeds the debt feels viscerally unfair, and that view prevailed here.”

The court’s ruling acknowledges the significance of home equity as a valuable property right and emphasizes the need for compensation when it is taken. It reinforces the principles enshrined in the Takings Clause of the Fifth Amendment of the US Constitution, which guards against the government burdening individuals disproportionately and without just compensation.

“The taxpayer must render unto Caesar what is Caesar’s, but no more,” stated the court. This decision clarifies that states with surplus retention statutes cannot exploit tax debts to seize more property than what is owed, ensuring a fair and equitable outcome for homeowners.

In addition to addressing the constitutional issue of property rights, the court also examined the question of whether such statutes violate the Eighth Amendment’s prohibition on excessive fines. Many local governments impose interest and penalties on unpaid taxes, serving as deterrents for late or non-payment. The court’s concurring opinion by Justices Gorsuch and Jackson highlights the need to assess the remedial nature of such sanctions and cautions against excessive fines that deviate from their intended purpose.

David Wilkes’s involvement in this case reflects his dedication to protecting the rights of homeowners and advocating for fairness within the legal system. His expertise and contributions have been instrumental in this historic ruling by the Supreme Court.